Sunday, April 09, 2017

Can rationalist communities still change the world?

In my last post, I recounted some historical examples of times when (broadly defined) rationalist communities - groups of smart generalists debating and trying to figure things out - changed the world. A number of people noted that my examples are all from the fairly distant past, and have asked whether similar changes are possible today.

Well first of all, I think there's a selection bias at work in our assessment of who "changed the world". The Royal Society looks world-changing now, but in its day it probably just looked like a bunch of eccentric tinkerers and nerds. It took centuries of progress, based on the foundations discovered in the 17th century, for those contributions to be properly recognized as world-shaking.

Second, I think whether groups are able to make big changes, especially in the social sciences, depends in large part on external events - i.e., whether there are big political changes happening at the time, for other reasons. The Meirokusha came along during a time when Japan was undergoing rapid opening and industrialization, and the Scottish Enlightenment came just before the Industrial Revolution, a wave of revolutions in Europe, and the formation of the U.S. and the British Empire. Right now, the world is in a relative period of stability (knock on wood) - it's hard to find recent groups that changed the world, because the political world just hasn't changed that much.

But given these caveats, I think it's still clear that a relatively small community of smart people can change the world.

One example would be the group of physicists, mathematicians, and engineers who came out of Europe in the early 20th century - Einstein, von Neumann, Bohr, Fermi, Schrodinger, and all the rest. These folks did a lot of groundbreaking physics and math, but they also invented refrigerators and nukes, made major advances in economics and computing, and probably did more to reinvent science than anyone since the Royal Society. The modern world is largely built around technologies and ideas that came out of that community. They weren't as cohesive of a group as the Royal Society, but they did mostly know each other, and there was probably significant cross-pollination of ideas.

Another group that changed the world was the Chicago School of economics. In the mid to late 20th century, the Chicago economics department saw a remarkable confluence of talent - Gary Becker, Robert Lucas, Milton Friedman, Ronald Coase, Frank Knight, and many others. The ideas that came out of that community changed the face of modern society. Some of those changes are things that many people don't like, but the same is true of the Scottish Enlightenment, the Meirokusha, the Progressives, the Fabian Socialists - indeed, the same is true of any social science community. The Chicago School thinkers were specialized in social science, but within that broad category, their ideas were remarkably general, dealing with almost every important social, political, and economic issue of the day.

Both of these communities could also reasonably be described as "rationalist". They were specialized, but not hyper-specialized - Einstein invented a refrigerator, Milton Friedman wrote political philosophy, etc. They had their ideological biases, at both the individual and the group level, but most of them were keen on figuring out how the world really worked (though there might have been exceptions to this).

Of course, just because it happened recently doesn't mean it could happen again. The 20th century might have seen the last great scientific advances that the human race will ever make. The ideas of the Chicago School might be the last coherent, original, influential outpouring of social thought. But note that this was just as possible in 1870, or in 1570, as it is today. There were probably scientists and social thinkers in those days who believed that everything important had been discovered and created. Almost by definition, big paradigm shifts in either natural or social science come unexpectedly.

A more worrying argument is that modern intellectual communities are too highly specialized. Some believe that science is just so hard now that progress can only be made by teams of super-specialized people digging deep into one domain. Others think that the incentive structures of modern academia, business, government, etc. encourages too much specialization.

I'm not sure whether science is too hard for generalist communities of polymaths to make big breakthroughs. The biggest scientific breakthroughs usually involve the establishment of completely new fields that few people were working on before - physics in the 1600s, electrical engineering in the 19th and early 20th centuries, computer science in the 20th century. We might have run out of new domains of knowledge, or we might not have - in fact, we'll never know whether we have or not.

I do worry about incentives. Modern academia is very siloed - there's a lot of pressure to publish in your own field's highly specialized journals. Scholars who venture into other areas, with new perspectives - think of Gary Becker trying to do sociology - are often resisted and even vilified as "imperialists" by the existing research community. Specialized academic communities can even become sort of like "mafias", resistant to new ideas.

I doubt that this is quite as big a barrier as many fear. The smartest people in their fields - think Terence Tao in math, Feng Zhang in biology, or Ivan Werning or Markus Brunnermeier in economics - have zero problem getting published in their own field, and have plenty of time to work on and think about other things. I picked these examples because they're all obviously highly curious people who have explored a lot of different fields within their discipline. Similarly, I don't think professional "mafias" will be able to successfully resist new ideas if those new ideas work. If Terence Tao went out tomorrow and made a macroeconomic theory that could predict the effects of monetary policy really well, I doubt even the most concerted resistance by macroeconomists could stop it from being accepted.

Meanwhile, the internet has opened up tons of opportunities for collaboration and cross-pollination. The economics blogosphere is a good example of this. In many ways, it's one of the most successful rationalist communities around today. Econ bloggers are often accomplished academics - Paul Krugman, Paul Romer, Narayana Kocherlakota, Brad DeLong, and others have all held faculty posts at top schools. But the range of topics the blogosphere deals with is fantastically wide - everything from presidential politics to art and culture to the history of science.

And though it's hard to tell, I'd say the blogosphere has had some real influence. The voluminous discussions of fiscal policy, as well as Krugman's forceful advocacy, have probably made austerity less popular across the developed world. Word of mouth tells me that relentless blogger criticism of macroeconomics has helped push younger academics toward more empirical and more micro-grounded research (and I think you can already see this in the literature). By publicizing the discoveries of academics' mistakes, such as with the Reinhart-Rogoff affair, econ blogs are also leading to a democratization of research evaluation and critique that might eventually challenge, or complement, the peer review system. And new ideas have come from the blogosphere - for example, Robin Hanson's use of signaling to explain social phenomena.

But the econ blogosphere has a problem - in order to have continued and expanded relevance, we need new people and we need more brain power. Much of the impetus for the efflorescence of blogging between 2009 and 2013 came from the Great Recession. The current crop of bloggers has had some spectacularly interesting exchanges - for example, Steve Williamson and Narayana Kocherlakota have a long-running monetary policy debate on Twitter that is more interesting than any other such debate I've ever seen. But for the blogosphere to become a rationalist community for the ages, we need more very smart people. We need polymathically inclined folks like Brunnermeier and Werning to start blogs, and to have exchanges of ideas on wide-ranging topics. If that were to happen, the blogosphere might eventually have an influence up there with the Chicago School. Currently, that is still a distant dream.

When reading your previous article 'When rationalists remade the world' I couldn't help but think of the modern econ blogosphere. I believe the econ blogosphere is the leading alternative to academic journals and PhD style economics. I really like how the blogosphere has no limits to creativity.

The econ blogosphere similar to traditional newspapaers we read, but acts more like a round table discussion between individuals. I also believe since the blogosphere is done by unpaid volunteers, it has less restrictions. For example, it's okay for a blog to have extremely technical material, while a newspaper would never allow this.

I have very little issue with so called "academic imperialism". I think the social sciences have a lot of overlap and that each group have a lot to teach each other. I have a lot of respect for historians, anthropologists, and political scientists because I do think they do a lot of good work thats very relevant for economists to at least look at. Sociology on the other hand . . .

Speaking to the rationalism-empiricism divide, a couple of years ago Krugman blogged, "There’s the Friedman dictum that [the unrealism of the model] doesn’t matter as long as the model makes good predictions; that’s actually quite problematic, and there are good reasons to argue that the realism of the assumptions matters too." [Faith-based Freaks, 2014]

Krugman promised to expand on this objection, but I haven't been able to find his follow up.

Maybe Noah can do the honors. What did Krugman mean here? (Is it that "a stopped clock is right twice a day", or a lot more?)

CNTRL + F + Patents = 0 hits. Sigh. Noah Smith seems friendly to public goods, even citing the Leo Szilard - Enstein (a patent clerk) fridge, but fails to mention the role that IP could have in promoting innovation and changing the world. Keep in mind the Royal Society, 'publications in prestigious journals', and public name dropping by esteemed netizens like Noah Smith have the effect of rewarding people who like public praise. For the rest of the people, who could care less, they go into law, medicine, politics, being middlemen and gate keepers. Why? No money in innovation. That can change, but it will take a while, possibly it will never happen if we can somehow hit the singularity (that would be nice but sci-fi at the moment). And why is that? Because people think innovation is an inelastic good: you either invent or you don't, with no amount of money changing the fact. That's the 'prior' driving people and society.

Changing the world is easy. From history and fresh personal experience we know that any moron can change the world. Change is a weasel word that covers both improvement and deterioration. In public discourse it is therefore regularly used to euphemize a deterioration. When a politician speaks of change people know that things are NOT going to be better but worse.

The word change is ideally suited for verbal shell games. The same holds for rational community. Without these weasel words Noah Smith’s question should read: ‘Can scientists still improve the world?’ His answer is, with some caveats, in the positive: “… I think it’s still clear that a relatively small community of smart people [e.g. “a group of physicists, mathematicians, and engineers who came out of Europe in the early 20th century”] can change the world.”

After this framing, the shell game begins: “Another group that changed the world was the Chicago School of economics.” By simple association we now have: economics = science, smart people = Chicago school, change = improvement.

The first thing to notice is that there is NO such thing as economics: there is theoretical economics and political economics. The main differences are: (i) The goal of political economics is to successfully push an agenda, the goal of theoretical economics is to successfully explain how the actual economy works. (ii) In political economics anything goes; in theoretical economics the scientific standards of material and formal consistency are observed.

Theoretical economics has to be judged according to the criteria true/false and NOTHING else. A closer look at the history of economic thought shows that theoretical economics had been hijacked from the very beginning by the agenda pushers of political economics. Smith, Ricardo, Malthus, Marx, Keynes, Hayek, Friedman, Krugman, Lucas and almost everybody in-between falls into the category of political economist.

Political economics has produced NOTHING of scientific value in the last 200+ years. If there ever was a political sect that violated the scientific standards of material and formal consistency then the Chicago School.

So, Noah Smith’s shell game has to be set right: economics = cargo cult science, agenda pushers = Chicago school, change = deterioration. To be sure “Gary Becker, Robert Lucas, Milton Friedman, Ronald Coase, Frank Knight, and many others” will never be accepted in the community of scientists. They have to be content with the membership of the the political club Mont Pelerin.

Noah, what you're referring to in your historical examples is the central theme of Joel Mokyr's A Culture of Growth. The Origins of the Modern Economy: the Republic of Letters. Mokyr describes the Republic of Letters as an elite community of 1,200 members in mid 17th Europe and 12,000 at most a century later, a mostly virtual community (discussions happened mostly by mail!), mostly outside universities, which were conservative and protective of entrenched knowledge. They were successful partly because, somehow, they created a functioning market for ideas and an intellectual unity in Europe, as opposed to its political fragmentation. The (emergent) incentive mechanisms in the Republic of Letters were competitive patronage and, more importantly, reputation based on peer evaluation. Out of the Republic of Letters grew open science, as an emergent property, where useful knowledge was recognized as a powerful force for economic change coupled to a Baconian program of social optimism.

Mokyr views the Republic of Letters as a unique (historical and geographical) institution that generated and diffused useful knowledge and, as such, as the missing link between the literature that views institutions as core difference between successful economies and less successful ones, and the literature that stresses the importance of technology and innovation in the origins of the Industrial Revolution.

"We might have run out of new domains of knowledge, or we might not have - in fact, we'll never know whether we have or not."

We have existence proofs. Nanotechnology in the form of control of the placement of atoms at the molecular level exists. And we don't know how to do it yet. Intelligence exists, and we don't understand it yet. We know there are domains of knowledge we have not yet fully explored.

Kurzweil argues that there are likely domains of knowledge that we know exist and will explore: sub-atomic technologies. Although he doesn't have an existence proof that these domains can be understood and exploited.